It probably depends on what the money's used for.

Smokers are a minority in American society, and political cost of sticking it to them on taxes is fairly low.  The thing about people who complain about taxes is that they are most often the least engaged in politics, and the least likely to vote.


And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

Don't you know that the market will provide?  Once gasoline becomes expensive enough, then ethanol, oil shale, and coal to gas will become competitive.

Of course, maybe standard economics is bunk because it supposes that consumers have a choice in the short term about how much they spend on gas.  It's not like buying a new car, or moving to another house closer to work is something that can be done overnight.  These sorts of repsonses to the market occur only in the long term.

And the problem isn't just one of creating demand, it's one of supply.  It's much more difficult to purchase a fuel efficient car in the United States than in Europe.  Now that's going to change as Detroit retools and the GM Volt plug in hybrid and other vehicles come out.  But those cars aren't going to start coming off the factory line until 2009 or later.  

Secondly, the patter of urban sprawl in America means that walking or taking the bus simply isn't a choice in most American cities.  And in larger cities, older urban neighborhoods that are walkable often have little or nothing in the way of grocery stores and other basic commerical services.  Tesco has announced that it's going to enter the US market, and try to establish itself in the small store urban market.  However, the other big problem is that many of these urban neighborhoods are desprately poor and have horrendous crime rates.

Do you really think that families with small children are going to move to neighborhoods where there are open air crack markets and drive by shootings because the price of gasoline has gone up?  Of course not, you'd have to be on crack to believe that.

But then orthodox economists seem to believe that this is the way that the world works.  I'll let you draw your conclusions from that.  

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

Home energy demand is far more more elastic than gasoline demand. Driving the car to work or not is a binary choice, but home energy consumption, whether it's the temperature of the thermostat or how often the lights are turned on, is not. Also cutting back energy use at home isn't necessarily a loss of status as it can often be hidden from your peer competitors.

you are the media you consume.